The Democratic Candidates and Your Credit Cards

Barack Obama and Hillary Clinton have both called for credit card reform. Their plans are similar in philosophy, but they differ in the details. (Neither Sen. John McCain, Mike Huckabee, nor Rep. Ron Paul has issued credit card reform proposals.) Clinton's proposal creates a new government commission to focus on credit card abuses and caps interest rates, while Obama's comes with a five-star rating system and a new consumer bill of rights.

You be the judge:

Clinton's plan:

• Cap credit card interest rates at 30 percent. (The Government Accountability Office reports that 1 in 4 credit cards charges higher rates.)
• Stop credit card companies from increasing rates without written consent from consumers and prevent rate increases because of missed payments on unrelated accounts.
• Require card companies to explain terms and fees clearly to consumers.
• Increase government regulation of credit cards and other credit products through the creation of a Financial Product Safety Commission.

Obama's plan:

• Create a five-star rating system for credit cards so consumers have a better sense of the fees and rates associated with each card. Card companies would have to display their star ratings with their application materials.
• Write a credit card "bill of rights" that would stop credit card companies from making "unilateral" changes to the terms of cards as well as apply interest rate increases only to future debt. It would also stop card companies from charging interest on fees, something the Clinton plan includes as well.